Mercedes 2015 Annual Report Download - page 116

B | COMBINED MANAGEMENT REPORT | REMUNERATION REPORT 123
The system of Board of Management remuneration in 2015
The fixed base salary and the annual bonus each continue to
comprise approximately 29% of the target remuneration, while
the variable component of remuneration with a long-term
incentive effect (PPSP) makes up approximately 42% of the target
remuneration. The base salary was increased by an average
of 3% in the reporting year.

B.45
With regard to the PPSP, an additional limitation of the target
achievement for the reference parameter return on sales
was decided upon for plans from 2015 onwards, if the strategic
target for return on sales (currently 9%) is not achieved.
As before, only 50% of the annual bonus is paid out in the
March of the following year. The other 50% is paid out a year
later (deferral) with the application of a bonus-malus rule,
depending on the development of the Daimler share price com-
pared with an automotive index (Dow Jones STOXX Auto Index)
E pages 63 f, which Daimler AG uses as a benchmark for the
relative share-price development. Both the delayed payout
of the portion of the annual bonus (with the use of the bonus-
malus rule) and the variable component of remuneration
from the PPSP with its link to additional, ambitious comparative
parameters and to the share price reflect the recommenda-
tions of the German Corporate Governance Code and give due
consideration to both positive and negative developments.
The maximum amounts of remuneration of the members
of the Board of Management are limited, both overall and with
regard to the variable components, in accordance with the
recommendation included in the German Corporate Governance
Code in 2013. Effective January 1, 2014, the members of the
Board of Management agreed to the inclusion of such limits in
their current contracts of service.
The maximum amounts of remuneration of the members
of the Board of Management were set as of financial year 2015
at 1.9 times the target remuneration for its members and
1.5 times the target remuneration for its Chairman. The target
remuneration consists of the base salary, the target annual
bonus and the grant value of the PPSP, excluding fringe benefits
and retirement benefit commitments. With the inclusion
of fringe benefits and retirement benefit commitments from
the respective financial year, the maximum limit of total
remuneration increases by these amounts. The possible cap
on the amount exceeding the maximum limit takes place
with the payment of the PPSP issued in the relevant financial
year, i.e. for the year 2015, with payment of the PPSP in 2019.

B.46
The individual components of the remuneration system
are as follows:
The base salary is fixed remuneration relating to the entire
year, oriented towards the area of responsibility of each
Board of Management member and paid out in twelve monthly
installments.

B.47
Maximum limit of total remuneration1 2015
Chairman of the Board of Management 1.5 times the target
remuneration1
Members of the Board of Management 1.9 times the target
remuneration1
Base salary in 2015
+ target bonus = 100% of the 2015 base salary
+ PPSP value when granted for 2015
Target remuneration1 in 2015
Base salary in 2015
+ annual bonus for 2015
(50% paid out in 2016 + 50% in 2017)
+ PPSP payment for 2015 (in 2019)
incl. dividend equivalent payments
Total remuneration1 in 2015
The possible cap on the amount exceeding the maximum limit takes
place with the payment of the PPSP for 2015 in 2019.
1 Excluding fringe benefits and retirement benefit commitments in all cases.
B.46
Ta
rget remuneration consists of non-performance-related
an
d performance-related components:
Remuneratio
n structure
B.45
base
salary
(n
on-performance-related) approx. 29%
shor
t- and medium-term
pe
rformance-related
c
omponents approx. 29%
lon
g-term performance-related
c
omponents approx. 42%
base
salary – fixed – oriented towards the area of responsibility
Base
salary – fixed E page 123
B.47
base
salary
(n
on-performance-related) approx. 29%
paid
out in twelve monthly
installment
s